Child and Adolescent Health Service

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Child and Adolescent

Health Service

Service Agreement 2014-2015

ABF/ABM PAQ Consultation Final

Program

Team Exec Dir

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27/06/2014 10:13 AM

Copyright to this material produced by the Western Australian Department of Health belongs to the State of Western Australia, under the provisions of the Copyright Act 1968 (C’wth Australia). Apart from any fair dealing for personal, academic, research or non-commercial use, no part may be reproduced without written permission of the Performance Activity and Quality Division, Western Australian Department of Health. The Department of Health is under no obligation to grant this permission. Please acknowledge the WA Department of Health when reproducing or quoting material from this source.

Important Disclaimer:

All information and content in this Material is provided in good faith by the WA Department of Health, and is based on sources believed to be reliable and accurate at the time of development. The State of Western Australia, the WA Department of Health and their respective officers, employees and agents, do not accept legal liability or responsibility for the Material, or any consequences arising from its use.

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Service Agreement 2014-15

This Service Agreement is between the Director General of Health as the delegated ‘Board’ (herein referred to as ‘WA Health’) and the Specified Health Service Provider. Both parties acknowledge that this Agreement follows policy, planning and performance frameworks as outlined below:

WA Health Strategic Intent 2010-2015 Clinical Services Framework 2010-2020 Clinical Governance Guidelines

Health Activity Purchasing Intentions 2014-15

Annual Performance Management Framework 2014-15. The Agreement:

1. Applies from 1 July 2014 to 30 June 2015. The Agreement does not override existing laws, agreements, public sector codes, statutes, government policies or contracts. 2. Integrates organisational objectives and the work of the Health Services.

The performance evaluation of this Service Agreement is to be undertaken as prescribed in the Annual Performance Management Framework 2014-15 .

The Health Service Provider will ensure that structures and processes are in place to comply with this Service Agreement and fulfil its statutory obligations and to ensure good corporate governance, as outlined in relevant legislation, the Department operational directives, policy and procedure manuals and technical bulletins.

WA Health Strategic Intent 2010-2015

WA Health is working hard to meet the challenges of a growing population and an ageing demographic. Demand modeling based on health service activity and population projections were used to develop the Clinical Services Framework 2010-2020. This provides a clear picture of the type and location of health services Western Australians will need, and is backed up by strong plans for workforce, infrastructure and technology.

WA Health Vision

Healthier, longer and better quality lives for all Western Australians.

WA Health Mission

To improve, promote and protect the health of Western Australians by: caring for individuals and the community

caring for those who need it most

making best use of funds and resources supporting the WA Health team.

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WA Health Organisational Structure

For the purposes of this Agreement, the WA Health Organisational Structure comprises the Department and a number of Health Service Providers and Support Service Providers operating as separate legal entities and key administrative units, as outlined in Figure 1 below.

All public hospitals and services within Western Australia are accountable through, and report on the delivery of services and outcomes as part of, one of these entities and/or key

administrative units.

FIGURE 1: LINK BETWEEN ORGANISATIONAL UNITS WITH WA HEALTH AND THE OUTCOMES AND OUTPUTS DELIVERED TO THE COMMUNITY

WA Health Roles and Responsibilities

To improve accountability within WA Health and to support the development of a system of earned operational autonomy over the short to medium term, this Agreement provides clearer delineation of roles and responsibilities for applicable organisations within WA Health. Roles and responsibilities for 2014/15 are outlined below.

Role of the System Manager

The Department, as System Manager, will be responsible for the overarching management of the WA Health system, exercised by:

1. ensuring the delivery of agreed high quality services and performance standards across the WA Health system, within the approved budgets set by the Western Australian Government

2. allocating the financial resources provided by Government to Health Service Providers and Support Service Providers in a manner which is both fair and transparent

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3. progressing a structure which empowers and incentivises Health Service Providers and Support Service Providers to deliver high quality services which increase system

capacity

4. issuing policy guidance, regulations and other requirements which support the role of Health Service Providers and Support Service Providers in the delivery of approved services to approved State standards

5. collecting and analysing data provided by Health Service Providers and Support Service Providers, to support the objectives of comparability and transparency, and to ensure that information is shared in a manner which promotes better State health outcomes 6. monitoring the performance of Health Service Providers and Support Service Providers

against the agreed performance monitoring measures specified in the Annual Performance Management Framework 2014-2015 (the Performance Management process is outlined in Schedule N of this Agreement)

7. reporting to the community on the high-level performance of Health Services Providers and Support Service Providers throughout, and at the end of, each the financial year 8. developing system-wide policy and planning for major infrastructure to support the

delivery of hospital services across the State

9. addressing salary and industrial relations matters, such as negotiating enterprise bargaining agreements and establishing remuneration and employment conditions 10. managing health legislation and processes to enact legislative change

11. managing and coordinating matters of corporate governance, contract management, disaster management and the development of unified ICT systems throughout WA Health

12. engaging with relevant stakeholders to ensure their views are considered when advising Government on health matters or making decisions in the areas listed above.

Role of the Health Service Provider

The Health Service Provider will be responsible for health service delivery within their geographical boundary (including services provided via Statewide Service Provider(s)), exercised by:

1. delivering agreed high quality health services and performance standards within an agreed budget, based on annual strategic and operating plans, to give effect to this Agreement

2. implementing clinical quality standards in accordance with Department policy

3. implementing the National Safety and Quality Health Service Standards and ensuring that all hospitals are accredited under the Australian Health Service Safety and Quality Accreditation Scheme

4. providing hospitals with annual activity, expenditure and FTE limits, and requiring that they develop robust monthly profiles to manage within annual resource allocations

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5. improving local patient outcomes and responding to local issues

6. ensuring accountable and efficient provision of health services, consistent with relevant State financial management and audit legislation and regulations

7. monitoring the performance of hospitals against the agreed performance monitoring measures in the Annual Performance Management Framework 2014-2015 (managing the hospital and service delivery performance as identified in Section 6.2 of the Annual Performance Management Framework, and outlined in Schedule N of this Agreement) 8. providing timely information to the Department to support compliance with obligations

under national agreements, to meet the requirements of whole of government processes and to support effective management of the health system

9. managing the implementation and local planning for minor capital items.

10. engaging with stakeholders to enable their views to be considered when making decisions on local service delivery

11. complying with statutory and contractual requirements applicable to Health Service Providers

12. adhering to budget and other financial requirements of the Department as set out in Schedule O (as amended from time to time)

13. assisting the Department by contributing expertise, local knowledge and other relevant information to service and infrastructure planning arrangements.

Role of the Support Service Provider

The Support Service Provider will be responsible for:

1. deliverying key outputs and performance standards within an agreed budget, based on annual strategic and operations plans, to give effect to this and other agreements 2. supporting the delivery of agreed high quality services and performance standards and

managing service delivery performance as identified in Section 6.2 of the Annual Performance Management Framework, and outlined in Schedule N of this Agreement 3. ensuring accountable and efficient provision of health outputs, consistent with relevant

State financial management and audit legislation and regulations

4. providing a service charter to the Department and Health Service Providers, identifying the outputs to be delivered and associated standards of delivery

5. providing a clear schedule of prices for services provided to Health Service Providers and the private sector to the Department annually and when prices change

6. managing the implementation and local planning for minor capital items

7. complying with statutory and contractual requirements applicable to Support Service Providers

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8. adhering to budget and other financial requirements of the Department as set out in Schedule O (as amended from time to time)

9. assisting the Department by contributing expertise, local knowledge and other relevant information to service and infrastructure planning arrangements.

It is anticipated that roles and responsibilities will evolve over time in line with best practice and the needs of the Western Australian community. The roles and responsibilities will be subject to periodic review.

Financial Management

Bilateral Discussions with Health Services Providers and Support Service

Providers

Throughout the course of 2014/15, regular bilateral discussions will be held between the Director General of Health and each of the Chief Executives (or equivalent) from the Health Service Providers and Support Service Providers. These discussions will focus on financial performance and progress towards achievement of key outputs and milestones within the Health Service Provider’s/Support Service Provider’s area of responsibility.

Performance Management

In 2014/15, the Performance Activity and Quality Division (PAQ) and Resource Strategy Division will convene regular Activity Based Funding and Activity Based Management (ABF/ABM) Performance Management Meetings with Health Services. The purpose of the meetings is to review performance reports and agree on action to be taken by Health Services to improve performance. The primary focus for 2014/15 will be on Health Service performance against financial performance indicators (PIs), activity PIs and a selected range of quality and safety PIs.

Review of the Agreement

The review of this Agreement and performance against targets will be undertaken at the end of each financial year (or earlier if required). The aim of the review is to strengthen and improve process and practices which lead to improvements in WA Health performance. The findings of the review may be submitted to the Minister for Health for consideration.

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Budget Allocation for 2014-15

Setting and Distribution of the WA Health Budget

WA Health’s appropriated budget for 2014-2015 is $8.0 billion. The WA Health budget makes up approximately 27 per cent of the overall WA State Government budget. The ABF component of the Health Service’s budget is approximately 85 per cent.

As part of the 2014-2015 budget submission, the Department provided the State Government with advice as to the likely volume of weighted inpatient activity, emergency department activity, hospital based outpatient activity and block services expected for 2014-2015 and for each year of the forward estimates. This approach allows the State Government to make informed

decisions through the annual budget process about the quantum of activity to be delivered by WA Health within the available State resources.

Methodology for Distribution of the WA Health Budget

For 2014-2015, the Department will continue to use an activity based allocation methodology aligned with the WA Health Clinical Services Framework 2010-2020 (CSF) for Health Services. In broad terms, this methodology includes:

 Activity based allocations continue to be based on the established growth outlined in the CSF and its demand and capacity modelling.

 Adjustments for circumstances such as budget constraints; contracted privately-provided public hospital services; post-CSF arrangements and/or other relevant reasons.

Block funded services are cost escalated and grown by an expected population growth factor.

Health Services

The ABF allocation for Health Services is determined by multiplying the PAC by the targeted volume of activity; expressed as WAUs. The 2014-2015 budget framework sets the price to be paid for each WAU. The budget is built by describing volume in WAUs by the PAC which is $5,162 for 2014-2015. Health Services allocate budgets to their respective hospitals based on a model that reflects expected activity and a price per WAU.

Refer to the WA Health Funding and Policy Guidelines 2014-15 for further information.

FIGURE 2: ABF FUNDING ALLOCATION FOR HEALTH SERVICES

Department of Health

The Department is comprised of: Office of the Director General; Office of the Deputy Director General, Resource Strategy Division; Performance Activity and Quality Division; Chief Medical Officer and System Policy and Planning, Office of Mental Health; Innovation and Health System Reform; Office of the Chief Psychiatrist and Public Health and Clinical Services Division.

PAC

Volume of WAUs

ABF allocation for

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For 2014-2015, the Department will continue to use a budget-to-budget methodology for Department of Health divisions, this methodology includes:

 The starting point for the 2014-2015 Budget for the Department of Health divisions is the approved 2013-2014 budget. The 2013-2014 Budget is adjusted to remove one-off items that will not occur in 2014-2015.

 The adjusted 2014-2015 budget is then further adjusted for known price movements such as cost of award changes and expected Consumer Price Index changes. The result is the status quo budget.

 The status quo budget is then adjusted to take account of other known changes, for

example, new initiatives, organisational re-alignments or the cessation of activities that were previously carried out. All adjustments at this stage are done at the 2014-2015 cost level.

Statewide Support Service

The Statewide Support Service comprises the following entities: PathWest; Dental Health; Health Corporate Network; Health Information Network. 2013-2014 budgets for the Statewide Support Service will be set using a budget-to-budget construction, similar to the process set out above for the Department of Health Divisions.

Mental Health Services

WA Health's budget for 2014/15 includes $586.0 million of funding to be received from the Mental Health Commission for the delivery of specialised mental health services by Health Service Providers (as outlined in the 2014/15 Budget Paper, page 129). This includes inpatient mental health services, teaching training and research and non-admitted funding, however excludes other specific funding provided by the Mental Health Commission1.

The Department, through the Office of Mental Health, will continue to work to improve mental health service provision with the Mental Health Commission.

Work is nearing completion to develop a 10-year Western Australia Mental Health and Alcohol and Other Drug Services Plan 2015 – 2025 (the Plan). The Plan will comprehensively address the mental health and alcohol and other drug service needs of the Western Australian

community and the joint Project Sponsors are the Mental Health Commissioner and the Executive Director, Drug and Alcohol Office (DAO).

This Plan will provide a ‘blueprint’ for the optimal mix of services needed for a better, more responsive and more equitable mental health and drug and alcohol system for all Western Australians over the next decade. The Plan will assist in the development of an integrated system that balances services across inpatient and community and is focused on the individual and recovery-orientated practice.

Professor Bryant Stokes’s Review of the admission or referral to and the discharge and transfer practices of public mental health facilities/services in Western Australia (the Stokes Review), provided comprehensive recommendations to advance mental health system reform including the need for the Plan.

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However, of this $586.0m, $585.0m has been allocated by the Department to Health Services for mental health services to date (as at June 2014).

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Health Service Catchment Area

The Child and Adolescent Health Service (CAHS) cares for children and adolescents through the metropolitan community and mental health services, the State’s only dedicated paediatric hospital, through specialised statewide services, and support to other hospitals and health services across the State.

In 2010, there were more than 507,000 people under 16 in Western Australia, of whom 5.7 per cent were Aboriginal. The under-16 population of the State is projected to grow to more than 591,000 by 2020.

Performance Objectives

The Health Service Provider seeks to provide and fund health services on a basis that is equitable, accessible, integrated and sustainable for the population in the catchment area. The purchasing priorities are:

to put the patient first and provide appropriate care close to where people live

to increase the emphasis on more cost-effective primary and community care to reduce the demand for hospital services

to deliver quality and accessible services within available resources

to achieve targets for emergency, inpatient, outpatient, ambulatory and elective surgery performance

for Health Services to be clinically and financially sustainable.

The Scope of Work

The Health Service Provider is comprised of a number of services including Princess Margaret Hospital for Children, Child and Adolescent Community Health, Child and Adolescent Mental Health Services and the New Children’s Hospital Project.

The Health Service Provider operates the following hospitals and services:

1. Princess Margaret Hospital for Children

The Princess Margaret Hospital for Children is a 220-bed paediatric tertiary teaching hospital. It is Western Australia’s only dedicated paediatric hospital for treating children and adolescents from around the State. Services include:

24 hour emergency department Allied health services

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Anaesthesia

Child protection unit Diagnostic imaging

Neonatology critical care unit Paediatric intensive care unit Rehabilitation

Rural paediatric service Surgical day procedure unit Specialist paediatric medical services:

Cardiology Dermatology

Endocrinology and diabetes Gastroenterology

General medicine

Haematology and oncology Immunology

Infectious diseases and refugee health Metabolic medicine

Nephrology Neurology

Respiratory and sleep medicine Rheumatology

Specialist Surgical Services: Burns

Cardiothoracic surgery

Cleft lip and palate and craniofacial Ear, nose and throat

General paediatric surgery and urology Orthopaedics

Plastic and reconstructive surgery Specialist Mental Health Services:

High acuity mental health ward Population Health and Ambulatory Care:

Provides services for children and adolescents to promote life-long health.

Programs and services work to prevent health problems by promoting wellbeing, early detection of diseases, early intervention and the provision of services in the community.

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14 2. Child and Adolescent Mental Health Service

This service provides specialist mental health services for children, young people and their families throughout the metropolitan area.

23 metropolitan community clinics.

In-patient services at Princess Margaret Hospital for Children, Bentley Adolescent Unit and the Pathways Residential service.

Complex ADHD assessment.

3. Child and Adolescent Community Health

This service provides a comprehensive range of health promotion and early identification and intervention community-based services to children, adolescents and families.

The focus is on growth and development in the early years and promoting wellbeing during childhood and adolescence.

Particular attention is given to groups at risk of poorer health outcomes, such as Aboriginal people and newly arrived refugees.

Services include:

12 metropolitan Child Development Services

106 metropolitan Child Health Centres providing services such as child health and development assessment, and immunisation

Aboriginal Health Team Humanitarian Health Team School Health Services At-Risk Services

Policy Services.

Key Outcomes and Priorities

In the next year the key priorities for the CAHS include:

Consolidating the CAHS services to ensure a comprehensive continuum of care from early childhood through to transition to adult services.

Working with the Office of Mental Health and the Mental Health Commission to ensure the ongoing development of mental health services for children and young people. Working with other agencies and non-government organisations to provide a wide range

of service delivery options.

Working with the Aboriginal community to improve the health of Aboriginal children in WA.

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15 New Children’s Hospital Project

Development of a $1.2 billion, 274-bed replacement hospital, co-located with adult services at Queen Elizabeth II Medical Centre.

Construction commenced January 2012, and full relocation by December 2015. Will include Telethon Kids Institute and education precinct developed in collaboration

with university partners.

Safety Quality and Performance

Patient safety and quality improvement programs are aligned to WA Health policy and the work of the Australian Commission of Safety & Quality in Health Care.

All services work to ensure that patients, families and carers are involved in the planning and provision of health care.

Outpatient Redesign Program at PMH

The Outpatient Redesign Program aims to improve the journey for children and adolescents under 16 years of age accessing outpatient appointments at PMH. To better meet the needs of patients, the redesign is focussing on:

reducing the wait time for first appointments

reducing the rate of non-attended appointments to less than 10 per cent reducing the average waiting room time.

Newborn Hearing Screening Program

This program is currently exceeding a 95 per cent statewide target for screening newborn babies.

Aboriginal Health

A number of key initiatives are underway to improve Aboriginal health including: CAHS Reconciliation Plan

CAHS Aboriginal Health Action and Advisory Committee CAHS Aboriginal Health Team

CAHS Aboriginal Employment Strategy.

Research

Child and Adolescent Community Health works closely with universities and independent research institutes, including the Telethon Kids Institute, to conduct research into various areas of child health.

Non Government Organisations

Princess Margaret Hospital for Children (PMH) has received funding from Telethon since 1983. During that time, Telethon has provided grants to PMH for the acquisition of state-of-the-art medical equipment, specialist facilities and research.

The PMH Foundation is the official fundraising body for Princess Margaret Hospital for Children. The charity provides funding for medical equipment, specialist services, research, capital projects, education and training.

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The Four Hour Rule Program commenced in WA in 2009/10 with the aim of ensuring that the majority of patients arriving at our emergency departments (EDs) are seen, admitted, discharged or transferred within a four-hour timeframe

In August 2011, Western Australia committed to national reforms including a National Emergency Access Target (NEAT). The NEAT requires 90 per cent of all patients presenting to an eligible reporting ED to be seen, admitted, referred to another hospital for treatment, or discharged within four hours where it is clinically appropriate to do so.

Output Classes and Statement of Forecast Service Performance

One of the functions of this Service Agreement is to show how the Health Service Provider will evaluate and assess what services and products are delivered in 2014/15. For each output area outlined in the relevant Schedules there are agreed performance measures and targets, some of which are aligned nationally.

These measures and targets will be subject to an annual audit by auditors of the State Government’s Office of the Auditor General.

The performance measures are specified in the Annual Performance Management Framework 2014-2015.

Table 1 demonstrates the linkages between the WA Health outcomes, output classes and outputs.

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17 TABLE 1: WA HEALTH OUTCOMES, OUTPUT CLASSES AND OUTPUTS

Outcomes Output Classes Outputs

Acute Services

Restoration of patients’ health, provision of maternity care to women and newborns and support

for patients and families during terminal illness. Elective Services Subacute Services Rehabilitation Services Diagnostic Services Pharmacist Services HITH RITH

Palliative Care Inpatient and

Community Care Acute Services Diagnostic Services Pharmacist Services Allied Health Medical Nursing

Mental Health Acute Services

Health Promotion

Enhanced health and well-being of Western Australians through health

promotion, illness and injury prevention and appropriate

continuing care.

Screening Programs

Chronic Disease Management

Mental Health Community Services

Emergency Care

Public Hospital Non-admitted Patients Prevention, Promotion and Protection Public Hospital Admitted Patients Home-based Hospital Programs

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Key Mechanisms for Performance Intervention

Full details of the performance management process are specified in the Annual Performance Management Framework 2014-2015, and outlined in this Agreement.

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Master Schedule - Total Expenditure View

ACTIVITY BASED SERVICES BUDGET 2014/15 ($) WAUs (#)

Inpatient 187,611,973 36,345 Emergency Department 41,224,308 7,986 Non Admitted 56,411,572 10,928 Non Admitted - Aggregate -

-Sub total 285,247,852 55,259

CSS - Price Adjustment 7,017,913

NON-ACTIVITY BASED SERVICES NON-ABF BUDGET 2014/15 ($)

Financial Products 42,754,435 National Partnership Funding 277,904 Non Admitted Mental Health 42,677,619 Public Health & Ambulatory Care 102,237,223 Special Purpose Funding 33,045,234 Teaching, training and Research 20,716,252 Small Rural Hospitals

-Sub total 241,708,667

less...Procurement Savings - 966,000 less…Microsoft Enterprise Agreement (True Up) - 1,186,667 less…Community Services contracts ceasing - 164,659

Total Expenditure Budget 531,657,106

The Schedule(s) outline the Activity as Weighted Activity Units (WAUs) and associated budget allocation by category for the hospitals in the catchment area.

The Annual Performance Management Framework 2014-2015 specifies the performance management plan, targets and performance thresholds for Activity.

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Commonwealth Specific Purpose Payment Activity and Funding

Activity Funding

National efficient price (NEP$)

C'w ABF funding contribution

(as set by IHPA) ($)

Acute Admitted 30,997 5,007 37.7% 58,567,291 Admitted Mental Health 3,247 5,007 38.1% 6,188,401 Sub-Acute 87 5,007 43.8% 190,565 Emergency Department 7,005 5,007 36.1% 12,666,410 Non Admitted 10,096 5,007 40.3% 20,371,093 Non Admitted Aggregate - 5,007 40.3% ABF Total 51,432 5,007 38.0% 97,983,760

ABF Service group

Commonwealth Contribution

Total expected NWAU modified for IHPA

adjustments

C'w % funding rate

In-Scope Block Funding

Total Contribution Commonwealth Contribution Commonwealth funding rate ($) ($) (%)

Non Admitted Mental Health 11,834,504 3,276,397 27.7% Other 'In-Scope' Program Services - - 41.6% Rural CSO sites - - 35.4% Teaching, Training and Research 20,716,252 6,576,321 31.7% Total block funding 32,550,755 9,852,718 29.9%

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Performance Management

Key Performance Indicators and the Performance Management Framework

In 2014-15, WA Health’s activity purchasing will once again require the application of ABF and ABM which in practice requires an Annual Performance Management Framework (PMF). The PMF for 2014-15 details the specific operation of ABF/ABM across the WA health system in 2014-15. The PMF was introduced in 2010-11 for ABF-funded hospitals in WA to consolidate performance reporting, monitoring, evaluation, management and intervention. In its fifth year, the PMF will continue to progress its maturity with: the introduction of vertical equity; the inclusion of private facilities providing public services, the addition of a clinical coding quality indicator; and the

adoption of cell suppression within the Performance Management Report. In addition, the ongoing alignment to state and national priorities will ensure that the PMF

2014-2015 maintains its relevance both locally and nationally.

The PMF 2014-15 continues to be aligned to State and National strategic priorities. The Health Activity Purchasing Intentions 2014-2015 provides details on the annual purchasing priorities and ABF/ABM policy drivers for the Department of Health. The PMF 2014-15 should be read in

conjunction with other Department of Health documents and publications including the following:

 ABF/ABM Annual Performance Management Framework 2013-14  WA Strategic Plan for Safety and Quality in Health Care 2013-2017

 ABF/M Performance Management Report Performance Indicator Definitions Manuals  ABF/M Performance Management Strategic Directions 2014-15 and Beyond Consultation

Framework

 Performance Reporting and Data Quality within the Performance Management Framework  Activity Based Funding Components of the 2013-2014 Health Budget Technical Bulletin

01/2013

1.1 Performance Reporting, Monitoring, Evaluating and Management

The PMF involves a system of reporting performance against specified Key Performance Indicators (KPIs) for each Service Provider. Reporting on the performance of Service Providers against the KPIs occurs on a regular basis, with the level of performance assessed against an agreed target.

The 2014-15 PMF has 22 KPIs, targets and thresholds for Performance Rating and 35 Health Service Measures and targets. The new Health Service Measure on the quality of clinical coding is the only additional indicator in the PMF 2014-15. Each KPI is accompanied by a Data Quality Statement and an Outcome Statement. Data Quality Statements are designed to sufficiently inform users of the quality of data enabling confidence in the decisions being made concerning

performance management. Outcome Statements provide insight to users in determining the relevance of a KPI, enabling them to form of a more reasonable opinion of the intent of results presented.

Reporting on the performance of Service Providers against the PMFs KPIs and Health Service Measures is produced on a monthly basis. This takes the form of an online interactive scorecard, with four levels of performance assessed against agreed targets. The four level performance

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results are used to calculate an overall ‘Performance Score’ for facilities and Health Services. The Performance Score is calculated each month, to provide an indicative summary of performance across all KPIs for a facility or Health Service.

The performance of Service Providers is monitored regularly against the KPIs, benchmarks and thresholds specified in the PMF in conjunction with the Performance Score. Service Providers, or their nominees, will meet quarterly with the Department’s representatives to discuss the

performance of their health service and the facilities within it. If the level of performance against the target is unacceptable, an intervention process will commence to bring the performance back on track.

The basis of performance discussions between the Department of Health and each health services will be a new Health Service Management Report contained in the 2014-15 PMF which replaces the existing ‘WA Health Dashboard Report’.

The Health Service Management Report (the Management Report) refocuses performance expectations around a core set of performance indicators which underpin an effective purchaser provider relationship. The Management Report also benchmarks performance to assist in service comparison and provides an analysis to support better decision making across the system. Departmental Assessment of Performance

The Management Report will provide a departmental assessment of the performance of each health service – highly performing, performing, underperforming and not performing.

The performance rating will be based on:

 performance against the indicators listed in the Management Report  performance concerns identified by the Department of Health or others

 other relevant information, including the implementation of strategic priorities, recovery plans (to fix within year issues) and transition plans (to transition to the PAC)

 whether the performance of the health service is improving, stable or deteriorating. Actions Arising from Performance Assessments

The Department of Health will also determine the subsequent actions required to monitor

performance or correct any performance concerns – standard monitoring or assistance required. The level of intervention will be based on:

 the seriousness of performance concerns;  the likelihood of rapid deterioration;

 the level of support required to sustain health service operations or manage risks;  progress towards existing recovery plans;

 persistent and emerging financial risk; and  other demonstrated performance deficits. Standard Monitoring

Performance review meetings are held monthly between the Department and the health service. Sustained high performance may lead to less frequent performance review meetings. The basis of discussion will be the information and analysis provided in the Health Service Management

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The meetings aim to assist health services to proactively manage issues, with appropriate support to achieve performance targets and avoid the need for further action. The discussion will be

interactive and enable health services to raise relevant issues. The meeting will cover previously agreed actions, flag potential or emerging performance issues, and identify risks affecting future performance. Actions and requirements of health services and the Department will be clearly recorded.

Each quarter the performance review meeting will also involve a more in-depth discussion about the Performance Management Scorecard and the Quality Composite Score. The Governing Council of the health service will be invited to attend this meeting.

Assistance Required

If the Department of Health determines an assessment of ‘Assistance Required’ a range of responses maybe applied, including:

 More frequent meetings between the Department of Health and the health service.  Development of recovery plans by the health service to address performance concerns,

including analysis of the drivers of poor performance, mitigation strategies and implementation plans.

 Appointment of external resources, parties and expertise to assist the health service to address performance concerns.

 Implementing a peer collaboration model whereby health services assist each other in regards to addressing performance concerns.

 A requirement to undergo a department-sanctioned audit.

 Independent reviews, the scope of which is determined as appropriate to address the performance concerns, but which may include a review of the health service’s management capability.

It is proposed that a further review of the PMF and associated data/systems requirements will be undertaken during the 2014-15 financial year.

1.2 Service Agreements

The PMF forms the Health Services’ Service Agreements (SAs) between the Director General of Health as the delegated ‘Board’ and the Health Services. The SAs, in turn, form the basis of the Personal Performance Agreements between the Director General of Health, Health Service Chief Executives and Executive Directors, who have a direct accountability for delivery of health

services.

Service Providers operate in an environment of delivering the services set out in the SA. The SA is informed by the WA CSF 2010-2020, specifying the scope of services and target levels of activity for a facility. The SAs ensure that the Governments’ policy objectives on service delivery are clearly set out and provide the basis for both payment and evaluation of performance. The performance management of the SAs is undertaken as prescribed in the PMF.

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Financial Management

Financial Management Standard

It is essential to improve financial management and accountability in the WA Health sector. To assist in this improvement the following Financial Management Standard (‘the Standard’) outlines the criteria for better practice and guides Health Service Providers in improving their financial management. It focuses Health Service Providers on the internal organisational procedures and processes to support and improve financial management practice and accountability.

The principles of the Standard are consistent with Government expectations for public sector agencies.

The Standard contains twelve criteria for improved financial management and accountability: Criterion 1 – The financial objectives for the organisation are clearly defined, approved by the Chief Executive and are consistent with Department and Government expectations.

Criterion 2 – The Chief Executive’s responsibility for financial management is clearly defined and is supported by documented lines of financial accountability throughout the organisation.

Criterion 3 – A finance and audit committee is established as oversight for the financial aspects of governance.

Criterion 4 – Standing financial instructions with regard to Treasurer’s Instructions and AAS are updated to reflect current requirements, and these have been formally adopted by the Chief Executive, disseminated and implemented throughout the organisation.

Criterion 5 – Financial risk management processes exist throughout the organisation.

Criterion 6 – There is an effective and documented system of internal control for all financial management systems.

Criterion 7 – There is an adequate resourced, training and competent finance function. Criterion 8 – Staff including managers and the Chief Executive are provided with adequate information, instructions and training on financial management.

Criterion 9 – The Chief Executive reviews the effectiveness of its system of internal control for financial management at least annually.

Criterion 10 – The Chief Executive receives regular reports on financial performance and activity, and is made aware of significant risks, determines and takes appropriate action.

Criterion 11 – The Executive Director of Finance (or equivalent) provides an annual assurance to the finance and audit committee on the effectiveness of the organisation’s financial arrangements based on this standard.

Criterion 12 – The organisation can demonstrate that it has done its reasonable best to meet its key financial objectives.

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Child and Adolescent Health Service